Economics Now

Question 1

Economize

Answer 1

Using resources wisely. Furthers personal.group goals while consuming least amount of available resources.

Question 2

Economics

Answer 2

Social science of dealing with production, distribution, and use of goods/services, resources, and wealth. Science of scarcity/choice.

Question 3

Economy

Answer 3

Complex/intricate system. Subject to changes. Consists of independent peope and groups. Involves series of transactions motivated by economic goals. Involved numerous transctions that crete two circular flows. Ex. ( Money moves in 1 direction, services move in the other)

Question 4

Effective

Answer 4

Consume certain amount of resources acheive wanted result in the end. Then resource is; effective.

Question 5

Efficient

Answer 5

Bare minimum of resources used to acheive wanted results

Question 6

Opportunity Cost

Answer 6

Sum of all that’s lost from taking 1 course of action over another. A fundamental economics concept.

Question 7

Analytical economics (Positive economics)

Answer 7

Descriptive: Portray things as they are in the past or present. Forecast on analysis of economic behaviour. “If x happens y will follow”

Question 8

Normative economics (Policy economics)

Answer 8

Statements that contain value judgement. Expresses particular economist or group of– opinion on case. Based on judgements. “Municipal governments should provide more housing for homeless people.”

Question 9

Fallacy

Answer 9

Hypothesis that’s been proven false, but still accepted by many people– appears to make sense

Question 10

Fallacy of Composition: Good for 1 individual, not good for entire society

Answer 10

Ex. Individual farmer may decide to clear more land/plant more corn in an attempt to earn extrs income. If all Canadian farmers did this= corn overproduced= corn value drops and market crashes.
New price is so low, farmers can’t recover from operating expenses=bankrupty

Question 11

Cause-and-effect fallacy (Post-hoc fallacy)

Answer 11

Assumes that one event causes another. What event comes before automatically causes the one after.

Question 12

Capital good

Answer 12

Those goods in the production of other goods. (ex. ploughs needed to prepare soil for planting)

Question 13

Fallacy of single causation

Answer 13

Premise that a single factor or person caused particular event to occur

Question 14

Consumer good

Answer 14

Products/services that directly satisfy human wants (ex. bread).

Question 15

Origin of economics

Answer 15

Greek word: Oikonomia: Wise management of one’s household

Question 16

Human material wants always ___ available resources means we live in a condition of constant scarcity

Answer 16

Exceed

Question 17

Economics

Answer 17

Study of the way we make decisions about the use of scarce resources.

Question 18

Behaviour of groups is ___ , behaviour of separate individuals isn’t

Answer 18

Predictable

Question 19

Economic Dilemna:

Answer 19

Wants exceeding ability to satisfy them

Question 20

Economic decisions must be ___ and ___ . Efficiency allows saved resources to be used on other goals.

Answer 20

Efficient and effective

Question 21

Scarcity of material things, it’s economically imperative to ___ and use things wisely to acheive right goals (effectiveness) and right way (efficiency)

Answer 21

Conserve

Question 22

Value judgement play __ ___ in some decisions made by Canadian government

Answer 22

Major roles

Question 23

Scientific method

Answer 23

4 Basic concepts:
- Observation
- Data collection
- Explanation
- Verification

Question 24

After hypotheses, are validated they become ____ ___, ____, and theories

Answer 24

Economic laws, principles

Question 25

_____ goods are needed to make consumer ____

Answer 25

Capital goods are needed to make consumer goods

Question 26

Production possibility curves demonstrate fundamental problem of ____

Answer 26

Scarcity

Question 27

1. Only 2 products can be produced by this simple economy

Answer 27

Economic trade-off. Increased production of one good can be acheived only by sacrificing a sufficient quantity of the alternative product. (ex. Consumer goods=bread, and capital goods=plough)

Question 28

2. Economy has fixed tech and resources

Answer 28

NO tech innovations will be introduced to improve rate of production. Assumes that amount of productive resources available DOESN’T change. Existing resources btwn production of bread/ploughs can be shifted, but no additional resources can be imported to the economy. Only way to make more bread, is to produce fewer ploughs.

Question 29

3. Economy is at full employment

Answer 29

Model assumes all productive resources, including labour are fully employed and being used effectively/efficiently to productive max. output of goods/services